The OEE formula

What does OEE measure?

OEE (Overall Equipment Effectiveness) measures the difference between ideal and actual production. How much could you produce when you produce at maximum capacity, and how much do you actually produce? OEE tells you how efficiently you are using your production resources.

The OEE parts

OEE focuses on three points:

1. Availability, or machine availability
2. Performance, or speed, performance level
3. Quality, or product quality 

First, you convert Availability, Speed, and Quality into a percentage, before you can calculate the OEE formula.This is how it works:

Availability: What is the actual machine availability?
Suppose the machine is available for 12 hours (720 minutes) each day. The machine halts on average 2,5 hours (150 minutes) each day.

Availability is:
(720-150 = 570 minutes) / 720 minutes x 100 = 79%

Speed: what is the actual machine output? In practice, short breaks in production occur because a machine malfunctions on occasion or a product has an uneven flow through the machine. How does it affect Speed?

Suppose the maximum theoretical speed is 300 products each day.

720 minutes / 300 units = 2,4 minutes per unit. 

However, in practice, only 250 products are made.

Speed is:

(2,4 x 250 units) / 720 minutes x 100 = 83%

Quality: All kinds of quality losses may occur: too large, too small, the wrong color. How many good products remain?
Suppose of every 250 products, 5 products are rejected.

Quality is:
245 / 250 x 100 = 98%

Once you know these numbers, you can calculate OEE.

The OEE formula

The OEE formula is:

Availability x Speed x Quality = OEE

In this example:

79% x 83% x 98% = 64%

The result of the OEE-formula

Great, you’ve calculated the OEE! But what does it mean? OEE tells you where bottlenecks in your production process occur, and what’s keeping you from more or better results. Once you have the knowledge, you can really start improving! The OEE formula, therefore, is a means and not an end!

OEE software

OEE software shows you instantly where waste occurs in your process and reveals the underlying reason. Why do you get less than optimal results? Cierpa OEE combines manual, digital, or real-time data and converts it into insight. That knowledge alone immediately delivers an output improvement of 3 to 5 %.